This one from an AE in a "red state": Q:  Do you know what the difference is between conservatives and progressives? A: About $16 trillion! Trillions - kind of like the money that Taylor Swift makes every time she breaks up with a guy during lunch, and then mints a hit song about it by dinner time. Seriously, within the Commerce Department, the Bureau of Economic Analysis announced Friday that "Personal income increased $15.0 billion, or .1%...and Personal consumption expenditures (PCE) increased $57.2 billion, or 0.5 percent." By my HP-12C calculations, given those percentages, every month we're making $150 trillion, and spending $114.4 trillion. I know this is overly simplistic, but no wonder banks are flush with deposits!

Mortgage Capital Associates a Southern California-based Direct Lender, operating in 32 states is seeking an Underwriting Manager (in the Los Angeles area) and in-house underwriters. The ideal candidate should have exceptional communication skills and thorough knowledge of Conventional and FHA Guidelines in addition to multiple investor overlays. For over 28 years Mortgage Capital Associates has been a leader online and is currently expanding its Branch Operations to target the Jumbo Market, and is already doing nearly $100/million per month in originations. Confidential resumes should be directed to Jason Kravitz at jkravitz@mtgcapital .com.

And in the next state over, Phoenix-based The Lending Company is in search of DE/CHUMS/LAPP Certified mortgage underwriters. "As an Underwriter you will be responsible for managing and monitoring daily workflow. Act as the subject matter expert on investor's loan guidelines and internal underwriting procedures. Make sound underwriting decisions on large and complex loans regarding credit worthiness of Borrowers.  Relay these decisions in a professional manner to Loan Officers and internal staff." A thorough knowledge of Ginnie, Fannie, and Freddie guidelines is desired, along with hands-on experience performing automated risk system data entry and output analysis. The ideal candidate should have current knowledge of RESPA and MDIA regulations, and know MS Excel, MS Word, Desktop Originator, Desktop Underwriter, Loan Prospector, Lenders Office, Calyx Point. For more information on the company visit here, and confidential resumes should be sent to Aileen Marcus at amarcus@thelendingco .com.

Yes, the CFPB is very concerned about all things consumer. Its most recent missive focused on credit reporting, which is guaranteed to be required reading at companies like Fair Isaac, VantageScore, Fitch, Kroll, and many other credit-score reliant companies.  As required by the Dodd-Frank Act, the CFPB compared credit scores sold to consumers to those sold to creditors to determine the impact of the different scoring models used by consumer reporting agencies. The CFPB found that for a substantial minority of consumers, the different scoring models yielded meaningfully different results, i.e., the consumer and creditor purchased different credit scores from the same reporting agency. In comparing different models across various demographic subgroups, the CFPB found that different credit scores did not appear to treat different groups of consumers systematically differently than other scoring models. The CFPB cautioned consumers against exclusively relying on credit scores they purchase as a guide to how creditors will view their credit quality. More

And NMLS is very concerned about licensing and tracking loan officers. To that end, it is making some changes later this month that LO's, and the people that manage them, should know about.

Yes, Ops, compliance, and legal staff usually outnumber loan producers in lenders. I received this note from Penny Showalter, the managing director of Cognitive Options Group, about trends she's seeing. "There is a lot of uncertainty and angst surrounding all the proposals, new requirements and looming thought of a CFPB audit for mortgage bankers, community banks and credit unions.  I am finding that most while doing a good job and handling lending in a compliant manner do not have the long list of required policies and procedures that are being asked for.  In addition the typical company has one person in charge of compliance and do not have the time, even if there is expertise, to handle day to day issues and also prepare for what is coming. The need for outside expertise and assistance has never been greater in our industry.  In order for lenders to meet the challenges initiated by Dodd-Frank and subsequently being implementing by the CFPB, processes need to be examined and reformed by subject matter experts that study the specific regulations and understand the ramifications to an organization. Vendor Management, SARs/AML reporting (new for mortgage bankers) and Fair Lending concerns specifically with disparate impart are keeping people up at night. But there is help out there from qualified mortgage professionals that can help ease the burden. Use LinkedIn, go to industry conferences to meet these experts and use the internet to search them out so you can make this long bumpy road a bit smoother and keep your mortgage lending practice successful." (Cognitive Options specializes in this - if you want more information on the firm go to www.cognops .com.)

On September 26, USDA's Rural Development office released an Administrative Notice (AN 4679) announcing that, "all RD programs will begin using 2010 Decennial Census population data ... on March 27, 2013."  The AN also states that, "until that time, and unless specifically directed otherwise, programs are instructed to use the population data from the 2000 Decennial Census."  The 2010 Census data will render ineligible for RD programs many areas that are currently eligible for such programs, including RD Section 502 direct and guaranteed single-family loans and Section 538 multifamily loan guarantees. Here you go.

Here are some relatively recent banking, agency, and investor updates to give you a flavor for recent changes and trends. As always, it is best to read the full bulletin.

Yes, it is almost hard for residential mortgage lending not to make money. This will, of course, change, but bank earnings are certainly profiting due to the residential business.

Saturday's commentary gave a sampling of bank M&A for various reasons, most notably increasing efficiencies. Bank closures are still with us, however, but seem to be slowing down. Friday we had one in Illinois: First United Bank for Crete, and the FDIC entered into a purchase and assumption agreement with Old Plank Trail Community Bank, National Association, in New Lenox, to assume all of the deposits of First United Bank.

Nationstar (which some dub "Wells Fargo Lite" given all the talent it has brought over from Wells this year) is not the only non-depository buying servicing. PennyMac Mortgage Investment Trust recently agreed to acquire a nonperforming whole loan pool totaling $452 million in unpaid principal balance. Although the seller is not known (it is often BofA, but that is just conjecture), about 53% of the UPB is related to loans backed by houses in foreclosure, while the rest is at least 90 days delinquent and most of the loans are in FL, CA, IL, NY, and NJ. One report mentioned that during the second quarter PennyMac bought $402 million in unpaid principal balances of both nonperforming ($224 million) and "reperforming" loans ($178 million). It isn't alone: Carrington Mortgage Holdings will close the year having bought $800 million in nonperforming loans which have an unpaid principal balance of roughly $1.6 billion.

As yet another reminder, temporary FHA guidance on condo project approval replaces the current provisions on the definition of "under construction," owner-occupant principal resident purchases, mixed-use developments, investor ownership, HOA dues delinquencies, project certification, HOA Fidelity Bonds and Fidelity Insurance, pre-sale requirements, and owner occupancy.  Full details of the changes, which will remain in place until further notice, are available here.

Freddie Mac is updating guidance on how servicers interact with state Housing Finance Agencies when assisting distressed borrowers.  Servicers should participate in state HFA modification assistance programs that allow them to apply funds as a partial principal curtailment for homeowners whose mortgages are either owned or guaranteed by Freddie, a practice that provides an additional way to help borrowers reduce their LTVs and achieve more affordable payments.  The funds received from the program must be put towards paying arrearages and any other past due amounts and decreasing principal so that the mortgage is recast or re-amortized without any other changes to the terms.  This should be done in conjunction with HARP or the Freddie Mac Standard Modification program for approved borrowers.  In addition, servicers should ensure that the funds applied to interest-bearing balances for borrowers who have partial forbearance don't go towards paying off the interest-bearing balance.

When completing foreclosures for active duty service members, Freddie servicers now have a maximum of 450 allowable delay days (increased from the previous maximum of 365) to finish the process provided that the delay can be attributed to military indulgence under the SCRA or similar state law.  This will apply to all foreclosure sales executed on or after November 1, 2012.

In compliance with the Fed's anti-steering rule, Wells Fargo Correspondent requires that the Anti-Steering Loan Options Disclosure be presented to consumers in cases where the safe harbor under Section 226.36(e)(2) of Regulation Z applies.  The disclosure must be signed and acknowledged by all borrowers listed on the Note at least one business day before closing.  Loans that fail to adhere to the anti-steering guidance will not be eligible for purchase by Wells.

GMAC encouraged clients to take advantage of its 30- and 45-day lock prices, which weren't priced to comply with the November 1st g-fee increase, and has issued a reminder than the spread between the 30- and 45-day price is less than the cost of a 15-day extension.  The g-fee increase is currently being integrated into the 60-day lock price. The g-fee increases bring changes for GMAC Freddie and Fannie products requiring extensions to close and disburse after October 19, 2012.  Loans with terms of less than 15 years are subject to a 50 bps increase, while those with terms of 15 years or more are subject to an increase of 25bps.   This applies to loans with 5-, 7-, 15-, 30-, and 45-day lock windows that have locked with GMAC prior to September 24rd and to loans with lock windows of 60 days or more that were locked prior to September 6th.  The fee increases are in addition to the existing extension fees as listed on the GMAC rate sheet.

Turning to the markets, sometimes I am tempted to write, "Rates are great" and leave it at that. But it is useful to talk about the economy, especially with last week showing us some disappointing reads on the economy. A good term would be "wallowing" or "slow growth trajectory." GDP is certainly less than expected, and the Durable Goods (items made to last three years or more) orders dropped over 13%. (Yes, it is volatile - in this case aircraft orders plunged more than 100%.) The "budding" housing recovery remains in-tact: new home sales in August missed on the headline, but remain near two-year highs, and the median price for a new home is now 17% higher than a year ago. July's Case-Shiller index also pointed to stronger prices.

For exciting scheduled economic news in the United States this week, there isn't much in the way of the 8:30AM EST numbers (the ones that can generally move rates more than other releases). That comment aside, later this morning we'll have some ISM Index number, and Construction Spending. Wednesday are the ADP number (of questionable worth in predicting the government unemployment data), another ISM number, and the FOMC minutes from the 9/12 meeting. (Those might be kind of interesting.) Thursday is the Challenger Job Cuts, Jobless Claims, and Factory Orders. But Friday is the Big Kahuna: employment. We closed the week with the 10-yr at 1.64%; this morning it's around 1.62% with agency MBS prices slightly better.

(Parental discretion advised.)
A little boy dressed up as a pirate knocks on the door on Halloween and an older lady come to the door and says, "Oh my goodness! Now what are you?"
The little boy answers, "Look, lady, I'm a pirate"!
The lady replies, "Well, if you're a pirate, where are your buccaneers".
The boy answers, "Right here under my buckin' hat!